CLEARWATER — After a year of planning, a multifamily residential and retail complex in the Prospect Lake Park area is moving closer to becoming reality.

The city council, acting as the Community Redevelopment Agency, approved the project Monday. The plan by Longwood-based Prospect Park Development LLC calls for 257 units of market-rate apartments above shops along Cleveland Street with an outdoor plaza fronting nearby Prospect Lake.

The city-owned parcel near downtown is 6.4 acres that was once home to a car dealership and repair shop at Cleveland Street and Prospect Avenue. The property has been vacant, and surrounded by a fence, for years since the economic recession stymied a previous plan to develop it.

What’s most pressing for city officials is getting more people to live, work and play in downtown and the surrounding area. The city spent some $10 million to renovate the Capitol Theatre, which reopened last December. And voters decided last November to allow a new home for Clearwater Marine Aquarium where city hall now sits.

The Prospect Lake area project is another benchmark of the city’s strategy, according to Geri Lopez, director of economic development and housing. The complex is intended as a community for young professionals particularly as tech businesses continue to move downtown.

The project calls for construction of a 257-unit apartment complex with an exercise area, business center and pool, and 15,000 square feet of ground-floor retail space.

The development agreement stipulates that the developer will purchase the property for $2.5 million by Oct. 31. The city bought the land in 1999 for $1.2 million. Construction is expected to begin within 12 months.

Lopez told council members that the completed project will be assessed for tax purposes at around $24 million. It’s expected to create 143 temporary jobs and five permanent positions.

Mayor George Cretekos said that while he originally opposed the plan, he now appreciates the work the team has done and looks forward to its success.

Council member Jay Polglaze said he applauds the efforts of city staff along with the patience of the developer.

“We’re going as fast as we can to get this project out of the ground by Thanksgiving,” he said.

To facilitate construction, the city will agree to reimburse the developer $700,000, representing a portion of the fees — impact, mobility, permitting review, water, sewer and fire — paid during development.

The city also will give the developer a $725,000 credit at closing of the property sale to help mitigate a soil clean-up necessary in some areas of the parcel along Park Street where the auto dealership and repair shop was located.

Because market-rate apartments rather than affordable housing are planned, the city must repay a $271,000 grant from the U.S. Department of Housing and Urban Development that was used to buy the property.

The city also will kick in to $250,000 to help the developer defray the cost of relocating utilities.

“This Prospect Lake site is important because it’s a city-owned property. A lot of the vacant land around it is privately owned,” Lopez previously told the council.

A towering commercial building just east of Prospect Lake that was being converted into a mixed-use condominium stalled during the recession and remains unfinished.

But the popularity of two downtown condo buildings completed before the downturn, Water’s Edge and Station Square, indicates a demand for such housing, and there now are few options for rental apartments in the area.